Catch The Wave

Happily Ever After

For all their qualities, good and bad, the Internet and franchising seem destined to become even more intertwined in the future. In fact, the popularity of the Internet has spawned a franchise industry all its own--a plethora of companies are selling e-commerce-inspired franchises such as Web site design, e-mail services, videoconferencing and virtual secretarial support.

And what of the majority of franchises that, by nature, really have nothing to do with technology? It's true the explosion of e-commerce has taken many by surprise--particularly those franchise chains that were in existence before the Internet was an everyday reality. As a result, many, if not most, of the franchise agreements of established chains make no mention whatsoever of how the Internet distribution pipeline is to be allocated. According to Susan P. Kezios, president of the American Franchisee Association, this issue has been increasingly troublesome for franchisees. (Consider how you'd feel if you were a franchisee selling software from a retail store and your franchisor started selling the same goods online.) Says Plave, "If I were a prospective franchisee, I would look at how technology will impact the franchised business in the next five years."

While franchising and the Internet still need to work through many issues relating to their marriage, many have high hopes for the union. In the future, franchise seminars will be held in virtual classrooms and prospective franchisees will conduct three-dimensional tours of the units for sale. Customers will print your virtual coupons. Regulators will regulate, and Web surfing will be refined. But when somebody figures out how to e-mail me a hot pizza, that's the franchise I want.

Contact Sources

American Franchisee Association, (312) 431-1132, http://www.franchisee.org

Rudnick, Wolfe, Epstien & Ziedman, (202) 712-7249

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This article was originally published in the January 2000 print edition of Entrepreneur with the headline: Catch The Wave.

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